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13th February 2019

The Torts (Interference with Goods) Act 1977: Goldmine or Garbage

By Kate Andrews

It is imperative for landlords to be vigilant about goods left behind in their properties by tenants as it may cause them more trouble than it is worth. As it happens, this has been a habitual dilemma for landlords who should be mindful of the responsibilities and requirements they need to adhere to when it comes to dealing with the disposal or sale of such goods. This is because if the goods are disposed of by the landlord and they later turn out to be of value, the landlord may be liable under a claim for damages as an involuntary bailee (someone who has, without their consent, found themselves in possession of goods belonging to another).

The Notice, the Sale, and the Disposal

A landlord can serve a notice under Section 12, Section 13 and Schedule 1 of the Torts (Interference with Goods) Act 1977 providing the former tenant, and/or any third party owner, with a specified reasonable period stipulated in the notice to collect the goods. This notice must set out contact details, a description of the goods, a reasonable period in which the bailor must collect their goods and so forth. In Houghland v R R Low (Luxury Coaches) Ltd  [1962], where a coach passenger could not locate her bag after having to transfer from one defective vehicle to another, it was recognised that the duty of care of a bailee is the standard one.

In the event that the landlord has fulfilled their duty under the Torts (Interference with Goods) Act 1977 but the tenant fails to respond, if at all, in a reasonable period, the landlord is authorised to sell the goods. Where these goods are not in a saleable condition however, the landlord must decide on the next step. This could mean deciding to dispose of the goods, and if this were to occur, the landlord is encouraged to keep a sufficient record of all of the goods so disposed to reduce the risk of any future damages claims against them.

Additionally, the sale of the goods should be for an appropriate price and the landlord ought to preserve the proceeds of sale. The length of such period will depend on the amount of money involved and all other circumstances.

On the other hand, where a notice cannot be given as it is near impossible to ascertain the rightful owner of the goods, the abandonment argument may be used. This would require establishing a reasonable entitlement to conclude that no one is interested in the goods so disposal is the only option.

For instance, the High Court in Campbell v Redstone Mortgages Ltd [2014] EWHC 3081 dismissed a claim by a bailor for damages where the landlord had disposed of the previous tenants’ goods. It was ruled that even though the bailor had attended the property on various occasions to remove goods, they had not cleared the property entirely, and therefore the landlord had acted reasonably in disposing of the remainder of the bailor’s possessions. It is also outlined that until the landlord has disposed of the belongings, they must ensure that they are not damaged or destroyed deliberately or recklessly. Naturally, the more the goods are worth; the higher the responsibility on the landlord to take reasonable care of them.

In spite of the above, however, the bailor (tenant) has certain duties of which they should be aware.  These include paying for any agreed services undertaken by the bailee/landlord, collecting the goods at the appointed or within a reasonable time and compensating the bailee/landlord against costs incurred in preserving the goods against certain unusual hazards.

Leases/Tenancy Agreements

The practical consequences are that the rightful owner of as many goods in the premises as possible should be outlined in the lease.  It is always stressed that landlords should tread carefully with regard to tenants’ abandoned goods to avoid claims for damages being made against them. It is usually good practice to have a clause that deals with situations where goods are left behind and confirm that landlords are entitled to remove them.

Da Rocha-Afodu v Mortgage Express Ltd [2014] EWCA Civ 454 is a prime example of a case where the mortgagee in possession was held not to be liable for damages where the mortgagee gave its mortgagor access to retrieve goods on several occasions whilst also providing numerous warnings and notices before the goods were disposed of.

Tips and Tricks

  • Inspect the property thoroughly once/just before tenants depart to ensure no goods have been left behind. This may act as evidence if you are required to defend a claim for damages.
  • Keep a sufficient record of all of the goods left behind –take photographs and keep an inventory (with description) of the goods.
  • Put up a general goods (section 12) notice to the door of the property after taking back possession.
  • Store all items accordingly and ensure they are not damaged or destroyed, deliberately or recklessly.
  • Retain any sale proceeds for a ‘reasonable period’.
  • Remember, the higher the value of the goods, the more responsibility is placed on you. Possibly seek the opinion of experts/professionals to ascertain the value of the goods.

 

The Torts (Interference with Goods) Act 1977: Goldmine or Garbage

Have a question? Contact Kate

Have a question? Contact Kate

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